Perhaps one of the greatest breakthroughs in
civilization is the concept of banking. Banking paved
the way to the creation of bigger corporations,
complex institutions, more secure financial
transactions, and global economic interdependence.
People manage money through banking to make sure that
the heard earned money that they acquire stays safe,
healthily anchored in a national market, and easily
accessible without having to hold on to the money
itself.
Banks have been introduced since approximately 3 B.C.
when temples held resources in terms of grains and
other produce for commercial trading. Modern banking
which standardized banknotes as currency was
established during the 1500’s and marked a new era of
western banking as well.
Since then, banking have been brought to new heights
with introduction of technology which allowed virtual
banking while still being associated with real world
currency. Faster transactions and larger volumes of
money can now be transferred to any point in the globe
with a global banking system with just a click of a
button.
Managing money has been developed in consistency to
provide ease of understandability and utilization for
the common citizen as well. This ensures that a
healthy banking and economic environment is
maintained.
Personal Accounts
The most common and simplest form of a way to manage
money through banking is by opening a personal
account. This is then given an option of how the
account should act, either as a savings account or a
checking account. The former is the most basic form of
savings with a fixed interest rate, as well as a
minimum maintaining balance to prevent account
closure.
The latter is designed to allow individuals who handle
a larger amount of money to transact and pay without
having to go to the bank and withdraw the large amount
of money, thereby exposing himself to danger. Checks
are tendered as legal bank notes, holding power to be
converted to cash by the recipient.
Time Deposit
Time deposit accounts are fairly simple in nature. It
is similar to a savings account, but only that there
is a fixed matrix set by the bank for client
compliance in terms of the amount of money deposited.
This is of course corresponded with the appropriate
interest rate and benefits, should the amount in the
matrix be higher.
There is one main catch for this type of managing
money which is that when the individual engages on
this savings type, the money that was deposited is
waited to mature before it can be manipulated.
Otherwise, the interest rates and benefits are not
honored or curtailed in the process.
Credit Cards And Debit Cards
Credit cards and debit cards are two of the other
alternatives to do banking. These are electronically
crafted items which can be used to serve as a portable
resource. Establishments supporting these types of
transactions credit the expenses directly to the bank
holding that account for any charges that are billed
to the owner of that card. Though this is a convenient
and safe way to not bring any cold cash around, the
risk of getting victimized by fraudulent activities
such as credit card information hacking and the like
also exposes the user to a level of threat with his
money and resources.
A credit card is a feature given by a bank to its
client to be able to buy in advance and be billed
later on and deducted with the appropriate charges
incurred over a monthly cycle plus taxes and charges.
A debit card is more of a limited credit card that
allows the user to transact with an electronic card
with establishments, only that the amount of charges
that could be incurred is based on the actual money in
that account and nothing more.
It is a tricky concept to manage money through banking
if not understood correctly. It is therefore
encouraged to the clients to read the fine print, and
the terms and conditions as well for the different
bank policies.
